Sharing thoughts in our quest to regain some of the peace and tranquility we knew as children growing up in rural America in a time gone by. I hope you find this narrative both comforting and inspiring. I hope it brings back memories and helps you move closer to your dreams. This is one aspect of my life that has never faltered, never strayed from home. This is a dream come true.

Wednesday, November 12, 2014

A short piece I wrote to comment on a family that had spent $58,000 on a solar panel/battery solution for going off-grid.

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We're building a retirement home in the woods of East Texas. We worked up the budget to go off grid. We had solar panel, batteries, inverters, charge controllers, etc. The bill was staggering when you're only paying 9¢/KWHr. It was going to take way too long for our return on investment. The heavy side of the cost equation - the batteries and the charge controller. The heavy side of the labor equation - the batteries and the charge controller. My answer - net metering. On one hand I could buy $6,000 worth of batteries and a $2,000 charge controller - or, I could stay on the grid and put all of my investment into the panels and inverters. All I needed to do was offset the use, I didn't need to become my own power company. I didn't need to store electricity for days at a time. I just needed to buy enough panels to roll my yearly bill back to zero.

I wasn't concerned with the monthly roller coaster. I might have to pay one month but get a credit the next. By the time the year rolled around though, l would have enough credit to carry me into the summer months, air conditioners included. I wouldn't have to worry about monitoring and babying my batteries. I wouldn't have to worry about extended weather conditions that would keep me from charging. I wouldn't have to worry about kicking on my generator when we wanted to run everything at once. I also wouldn't have to worry about replacing my batteries every 7-10 years! This was what sealed it for me. 60% of the cost of the system was going to be battery storage. This was also the weak link in the system! It was finicky about charging, took up huge amounts of space, took the most effort to keep running at peak and to top it off - it wore out the fastest!! What was I thinking! The $6,000 I was going to put into batteries (every ~8 years) could be invested in panels that have a 25 year lifespan and mean that I would never pay another bill for usage.

That was my goal in the first place - not to have to pay an electric bill! I would still have the grid there to back me up when I needed (instead of my generator). The best part, I don't have to do anything to manage it. I don't have to change the way we live or work out schedules of who gets to dry their hair when. We'll go about our business just like normal and at the end of the month, we toast to not having to pay the electric company. Change your mindset. Think about your end game. What is it you really want? Financial freedom! Not to spend your spare time managing your own power plant. Think about your investment in the panels as a barter system if that makes you feel better.

I'm going to buy some solar panels and let the local electric company use them to generate electricity. They, on the other hand, are going to comp my bill in appreciation. Woo Hoo! Batteries are the weak part of the system. They are the most expensive part of the system. They have the shortest life span of the system. It becomes an easy choice once you take them off of the table. Solar panels or pay a monthly bill. Even if they eventually come up with an infrastructure fee to cover the cost of maintaining the grid, that fee would be much lower than my having to buy and maintain (and replace) batteries. I don't want to be a pioneer. I want to throw away my electric bill each month without even opening it! Don't lose site of your goal and get there as quickly and efficiently as you can.

If this family had stayed on the grid, they could have saved about $30,000, every 8 years! They could reinvest part (or all) of this (the first year only) into more solar panels and ensure that they never see another electric bill. All of that without having to put up with changing their lifestyle.

I had a sales rep come to my house one day, wanting to sell me replacement "energy efficient windows." I grant you, they were probably more efficient than what I had but the bottom line was that the most they could save me was about 10% of my electric bill and at $200 per month, that was only $240 per year in savings. They windows were going to cost $8,000! The question to ask it not whether the windows could save you money. The question to ask, are the windows the best investment choice for the $8,000? If I added another $8K to my 401K (which averages over 10% growth over the past 8 years), could I generate more than $250/year in return (the amount that the windows would produce). I would have $13K at the end of 5 years, an average of $1,600 per year. The windows will only have produced $1,500 worth of savings, 10% interest included in the entire 5 years! Let the 401K run another 10 years, and it's at $35,000. The windows will have only produced $8,000 worth of savings in those years. I will also NEVER get my initial investment back out of the windows. If I don't sell the house, I've just lost the original $8K. If I do sell the house, I'm not going to get $8K over market price because I put new windows in it 7 years ago! The question to ask is not whether an investment will make money. The question to ask is what is your lost opportunity for not investing in something else! This holds true for batteries to go off-grid or for replacement windows. Be careful who you give your money to! Hold them to a standard that you already have access to. Make them beat the current investment options you have or send 'em down the road to someone who doesn't understand their options.